DIGIWORLD’S 30% GROWTH IN FY2018, WHAT ARE THE INCENTIVE?

Digiworld targets revenue of VND 4,700 billion in FY2018 (+23% y/y) and NPAT of VND 101 billion (+29% y/y). Xiaomi handsets, Kingsmen food for men, will be the major driving force behind this business.

Digiworld opened the first Mi Store under Mi standards in Vietnam in January 2018.

The plan is feasible according to Mr. Doan Hong Viet, CEO of Digiworld when, besides new products with high profit margin, sales of consumer goods recorded in every quarter of 2018 will also be expected to promote the overall profit margin of the Company.

In FY2017, Digiworld sales reached VND 3,820 billion, a slight increase over the same period last year and earned VND 79 billion NPAT (+17.5% y/y exceeding 42% of the annual profit targeted by the General Meeting of Shareholders).

According to Digiworld, FY2018 sales will be much more promising with 23% growth (VND 4,700 billion) and VND101 billion profit (+28.9%)

Optimistic growth for 2018

Laptop and tablet segment will remain the major revenue contribution for Digiworld in FY2018 with VND2,3 trillion, followed by handset segment with VND 1,2 trillion. Office equipment segment will bring about VND1 trillion, VND200 billion of which is from consumer goods.

Mr Doan Hong Viet said Digiworld’s plan in each sector is feasible thanks to various new products that Digiworld has been introducing to the market this year.

In the laptop and tablet segment, Digiworld’s forecast indicates a slight increase from VND2,266 billion in 2017 to VND2,300 billion in 2018. The two main product lines hitting the niche market of Japanese and Korean businessmen-Fujitsu and LG Gram-have greatly contributed to the overall results of each segment.

Xiaomi products are a major contributor to handset distribution, followed by Sharp. In FY2018, handset revenues will increase by 59.6%.

A highlight from Xiaomi and Digiworld’s collaboration is that Digiworld opened the first Mi Store selling Xiaomi products in Vietnam in December 2017. Mi Store will be available in big cities in 2018 according to Digiworld’s CEO.

On January 22, Redmi 5A was first offered for sale on Lazada where 2,000 cellphones found their owners just in the first 5 minutes of sales. At the end of that day, according to Xiaomi, 35,000 people registered to buy Redmi 5A.

Xiaomi products and Sharp phones,to be launched in early 2018, will contribute significantly to Digiworld’s sales revenue in 2018.

Regarding consumer goods and healthcare products, Mr. Viet said that by the end of 2017, Kingsmen was present in 4,000 stores, which will increase to 20,000 stores in 2018.

It is noticeable that in Q2 2018, Digiworld will import new products for children’s health and promote products with the brand from the US. Digiworld expects the market for this product to be around VND 2 trillion.

In Q3, Digiworld will distribute liver protection and blood circulation functional foods. Digiworld forecasts the market for both products is about VND 3 trillion.

In addition, Digiworld is seeking proper M&A opportunities.

Source: Cafebiz.vn